Analysts are comparing the merger of Times Mirror and the Tribune Company to AOL-Time Warner, but the combined company looks more like an industrial age holdout than a 21st century media giant.

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March 15, 2000 7:00PM (UTC)

Early stories about the merger of Times Mirror Company and the Tribune Company tended to focus on the end of an epoch. The Chandler family was relinquishing control of Times Mirror and its crown jewel, the Los Angeles Times, and company CEO Mark Willes had finally met his demise. (The good news: He's out of a job. The bad news: he could be looking for work soon. How's your severance package?)

Though business analysts were split on the deal (Times Mirror stock rose 76 percent upon news of the merger, closing at 84 and a half Monday; the Tribune's plummeted to a low of $27.88 before rebounding to the $30 range), most seemed to agree that the two companies had cobbled together ... something.

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In the wake of the Time Warner-AOL marriage, all media mergers must be described as coming in the wake of the Time Warner-AOL merger. And in fact, the Chandler family (which still controls 66 percent of Times Mirror's stock) thought Willes (his role in the L.A. Times-Staples Center fiasco notwithstanding) was not "forward looking." And in the age of new and old media convergence, forward looking means investing in the Internet.

So it was not too surprising that, come Tuesday, the Tribune Co. (which, for all intents and purposes, acquired Times Mirror) was spinning this deal as ... a Web thing! This was in part a ploy to appease certain investors who failed to see the beauty of the new alliance. The initial gagging reaction of Tribune investors resulted in part from their perception of the merger as a move away from the company's Internet strategy, which has been more aggressive than that of most newspaper companies.

Broadcast and new-media properties are what makes the mare go in the world of media stocks -- and though Times Mirror boasts seven newspapers and 19 magazines, it has no TV stations to match the Trib's 22. Its Web holdings are also negligible.

Granted, the L.A. Times Web site has evolved into one of the better newspaper sites in the U.S. But the paper's popular Calendar section exists online as Calendar Live, a co-production of the Times and Citysearch. That doesn't do much to sweeten the Tribune's new-media pot. Meanwhile, the Tribune has invested heavily in AOL, iVillage, Excite@Home and Peapod.com.

So what, Trib shareholders (and more than a few media watchers) wanted to know, is with all those dead trees? What does that get us that we didn't have already?

Clout, according to Tribune Publishing president Jack Fuller. In the company's press release he saluted the history of shared excellence the combined papers had (over 80 Pulitzers between them). Then he noted that the combined company will have an expanded presence in foreign bureaus and Washington and increased national coverage from other bureaus around the U.S. "We'll have premier international and national coverage and deep, extensive coverage of Washington," said Fuller.

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So despite all the misgivings of the affected reporters out there, the Tribune Company (as the merged entity will be known) could be more than one of the nation's largest newspaper companies. It could be the nation's largest newspaper.

Not your grandfather's newspaper, of course (or Gen. Otis and Col. McCormick's newspaper either, for that matter). According to the L.A. Times (which has done some of the best reporting on the merger), "Tribune envisions giving advertisers a one-stop shop by delivering a range of local outlets such as television, radio, newspapers, cable channels and Internet sites in the same city."

Such a one-size-fits-all Web site (It's a portal! It's a directory! It's a news source!) is a sort of holy grail on the Web, and a lot of money has been lost in its pursuit. Ask the Tribune Company, which is still trying to disentangle itself from AOL's Digital City after years of mutual dissatisfaction. Or Times Mirror, whose joint venture with Citysearch has not been a source of great happiness for either company. (Conspiracy theorists take note: I worked for both Digital City and Citysearch and base some of my observations on my own experience.)

"At this point, we don't know what the implications of the merger are," says a source within Citysearch, who chose to remain anonymous. "Calendarlive.com is still a partner-led effort (the L.A. Times provides the management and content and Citysearch provides the technology). We haven't received any indication from the Times new-media people, but judging from the reporting here, most people at Times Mirror don't know much right now. Trib is definitely heavy into new media, but they haven't shown their hand in any way we can discern."

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Granted, a cohesive strategy will probably take time to hammer out. (As with most media company mergers, the philosophy behind this one seemed to be jump first and work out the details later.) But some in the Tribune's interactive division are making sounds that they're after something bigger than another Citysearch. "It gives us a huge spotlight," Digby A. Solomon, general manager of the Chicago Division of Tribune Interactive, told the Online Journalism Review. "We're looking at a network of local information sites that includes the three largest markets in the country."

And, ideally, those local information sites would share one unimpeachable news source -- making the prize the Trib has its eyes on not the local portal market but MSNBC.com. But MSNBC editor in chief Merrill Brown doesn't seem especially concerned.

"Newspapers have an increasingly lengthy history of failing to make a dent in the national news scene on the Internet," he points out. "Remember New Century Network? That didn't work. In fact, when we started in 1996, I thought the principal competition for us was going to be USA Today, which is a powerful brand, a great product in print with lots of assets, part of a huge national newspaper chain. And lo and behold, they are a distant afterthought on the national internet news scene to people like us and CNN."

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While respectful of the Chicago Tribune and L.A. Times Web sites, Brown doesn't see either offering a national challenge to MSNBC.com. The news site, which edged past CNN.com to become the most trafficked news site on the Web, recently announced an alliance with the Washington Post and Newsweek. That deal fills out the pretty flush hand it already had with more branded content from two reliable and respected sources, strengthening the Web holdings of all three.

The evolution of theWashington Post site itself may serve as a cautionary tale for those ambitious parties at the Tribune. A popular local site, the Post was looking to go national. (Like the L.A. Times, the Washington Post has a joint venture agreement with Citysearch, which hosts the paper's popular Style section online) The newspaper's stated desire to make its content local by allowing people to customize it via their zip code (an idea employed by everybodyandtheirbrother.com) seemed trenchant, as did the decision to update the site twice a day.

"Only recently has the Washingtonpost.com gone to something they consider very innovative," says MSNBC's Brown, with its online afternoon edition called the "PM Edition."

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"But when you think about the notion of a p.m. edition -- yes, it's a step in the right direction for breaking news -- it's somewhat ironic: We put out a.m. editions and p.m. editions and change the news as even fairly minor events warrant."

What more is a p.m. edition than an online version of the afternoon paper? As events in Honolulu, San Francisco and Seattle have proved, the afternoon paper is as dead as Charles Schulz.

For the Tribune Company to dominate the Web news market, it needs more than a "let's pool our assets and charge advertisers more" strategy. Right now, the new company looks like a lot of local Web sites, papers and stations looking for a national identity (as opposed to a national news site with local partners). And we've seen the slouch of that beast before.